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Handing over the Reins

that citizens dont miss a beat when accessing government services electronically or in receiving services like welfare checks or food stamps."

Pennsylvanias Pet Project

Adding value was an important component in a $527 million outsourcing project in Pennsylvania, according to Aptheker. There, a consortium of 10 companies, led by Unisys, has established a new state-of-the-art facility that has taken over the complete data processing needs of 14 state agencies, replacing 17 separate state-run data centers. This makes Pennsylvania one of the first states to consolidate and outsource data centers across all state agencies.

Pennsylvania Gov. Tom Ridge, in announcing the opening of the new center recently, said it would save taxpayers more than $110 million, allowing more investment in other key technology projects to streamline government operations, enhance public safety and improve customer service.

The project, so far on time and on budget, was not without its challenges, however. "I can safely say that the extent to which you have to work with the human component and you have to navigate the minefield of politics and technology -- well, I dont think anybody could have foreseen the [labor] that was needed for that to work," said Aptheker. "But this wasnt a complete surprise or an insurmountable problem. We knew it would happen because this contract came on the heels of Connecticuts failure to outsource their IT infrastructure. So we sort of saw that happening outside our window as we were driving along."

Aptheker credits the success in Pennsylvania to carefully working with existing people and the IT management right up through the governors office to ensure that there were no huge layoffs. The key word was retraining. "We were able to take almost every employee who was made redundant because of the consolidation of the data centers and retrain them to do more critical things like networks and desktops," he said.

Curt Haines, project manager for consolidated data center, agrees that careful attention to the human element was one of the key reasons the project is succeeding. "We were not looking to fire people, but to retrain and redeploy them," he said. "The union leadership knew that early on, and when we proved to them that we were indeed retraining people, they did come a little bit to our side. In Connecticuts case, it was getting rid of the people, and the unions were against it right out of the gate. So that definitely was a big part of our success."

Haines also emphasized that an outsourcing project has to be a true business partnership. "There are issues every single day that come up," said Haines. "Its constant negotiating, constant give and take."

"Networks are probably the most critical component of IT these days and I dont think you want to go with anybody but a company that has a proven track record," he added. "You have to be comfortable that they will keep your network up, and they will supply appropriate redundancy if your network is that critical."

A Bold Move

It is important to note that Pennsylvania has not outsourced its actual network, just the operation of the new data center. And as it stands currently, there are no plans to extend that outsourcing. "Outsourcing the data center - was a strategic move to free up resources that could then be redeployed to such things as delivery of e-government services," Haines said.

However, one outsourcing initiative that is being watched very closely by other governments both at the local and state level is San Diego County, where their entire IT infrastructure is being outsourced to Computer Sciences Corp. and its partners -- a $644 million contract over seven years.

As the project stands, it is on budget and on time, generally meeting or exceeding the stringent performance, financial